sed '/Target/ is equivalent to grep Target | sed, except it involves one less process & one less pipe.

s/ means 'substitution', the most common sed command; s/foo/bar/ would replace instances of the string foo with bar, for example.

/\(#Gi[0-9]*\/[0-9]*:\) ... the brackets (which need to be escaped with a \) tell sed to mark everything between them as \1 (or \2 for the second marked pattern, \3 for the third etc). [0-9]* means 'any number of numbers', and \/ is an escaped / (it needs to be escaped because I'm using / as the separator for sed; if you use another separator, like |, then you wouldn't need to escape the /). So #Gi[0-9]*\/[0-9]*: is a pattern meaning 'start with #, followed by Gi, then any number of numbers, then /, then any number of numbers, ending with :'.

So \1 matches whatever string is detected by the pattern #Gi[0-9]*\/[0-9]*: In the first string given in the question,